Special Needs

07/08/2018

It is possible for some people with special needs to be able to save and invest their own money, without losing government benefits.

For the most part, government safety nets are designed for people who do not have access to other money. This is true of the most common safety nets used by people who have special needs, such as Supplemental Security Income and Medicaid. However, that has always made it very difficult for family members of people with special needs to leave them money without making them ineligible for needed benefits.

In response to this problem, ABLE accounts were created. These special accounts allow people who developed certain disabilities before the age of 26 to save and invest their own money or money that family members give them, according to the Wills, Trusts & Estates Prof Blog in "ABLE Accounts Give Disabled More Financial Freedom."

ABLE accounts are somewhat flexible. They allow the disabled to have up to $100,000 to use to supplement their benefits and still stay eligible for those benefits. It is not too difficult to get money into the accounts. A 529 educational savings account can be rolled into ABLE accounts. Some states even offer tax credits for putting money in an ABLE account.

One of the drawbacks to ABLE accounts, however, is that they can be tricky to set up properly to qualify under the law. For that reason, it is important to use the services of an estate planning attorney if you have a child with special needs to whom you would like to leave an inheritance.

05/19/2016

A notorious attorney who called himself "Mr. Social Security" has been indicted for fraud. This is good news for families of children with special needs and for seniors.

Kentucky attorney Eric Conn built one of the largest Social Security Disability law practices in the country and marketed himself as "Mr. Social Security." After a thorough investigation by the FBI, however, it appears Conn's practice was built on fraud.

He worked with a team of doctors to falsify his clients' medical records. If one of his client's was denied benefits, he is charged with then bribing an administrative law judge to approve the claim. The FBI investigation has resulted in an indictment.

This is extremely good news for people with special needs and their families.

The Social Security Disability trust fund is in dire straits and would have run out in 2016 had Congress not acted to save it in late 2015 by reallocating some funds from the Social Security Retirement Trust. Eliminating a large scale fraud helps preserve funds for those who need them.

Reallocating money from the retirement trust fund, which is only slightly better off in the long term, is not optimal. Seniors will benefit from the resulting preservation.

04/15/2016

Families with members who have special needs that require continuing care have some estate planning options to make sure that care is provided fairly.

When an adult child has special needs that require the help and support of parents it is important to create an estate plan that makes sure that support is provided after the parents pass away. This requires an estate plan that provides for the child's monetary needs in a way that does not disqualify the child from receiving government benefits. It also often requires creating an estate plan that provides those funds in a way that is fair to other children.

Supplemental Needs Trust – These trusts allow parents to leave assets for the care of a child with special needs, but leave those assets under the control of a trusted third-party who can make sure the assets are used appropriately and invested wisely. They also help prevent disqualification from receiving government benefits, which is often the result if a child with special needs is left a large inheritance in one lump-sum.

Life Insurance – To fund a trust for a child with special needs, parents can take out life insurance policies and make the trust the beneficiaries of the policies. This allows the parents to divide their assets between all of their children equally while providing the extra funds for the child with special needs in a way that other children will not view as unfair.

These are only two of several options for providing for child with special needs in an estate plan.

10/27/2015

Richard A. Courtney, President of the Special Needs Alliance (SNA) and principal in the Courtney Elder Law Associates section of Frascogna Courtney, PLLC, testified Friday, September 18 before the U.S. House Energy and Commerce Committee Subcommittee on Health in favor of the Special Needs Trust Fairness Act (H.R. 670). The bill would enable mentally capable adults with disabilities to establish "Special Needs Trusts" (SNT) on their own behalf. SNTs are a means of protecting eligibility for assets-based programs such as Medicaid and SSI (Supplemental Security Income), while holding funds for expenses that those programs fail to cover. The same measure was approved unanimously by the U.S. Senate on September 9th.

Richard Courtney told the Subcommittee members that the legislation that originally created Special Needs Trusts (SNTs), the Omnibus Budget Reconciliation Act of 1993, "included a drafting oversight that seems to assume that a person with disabilities lacks the requisite mental capacity to enter into a contract… We believe it was … not the intent of Congress to deny a basic right to individuals with disabilities."

In its report on the testimony, The (Jackson, MS) Clarion-Ledger's "Courtney testifies before Congress on behalf of persons with disabilities," said that, at present, special needs trusts funded with assets of an individual with disabilities must be created for that individual by his or her parent, grandparent, legal guardian or a court. Because of this requirement, adults with no living parents or grandparents and no guardian are forced to petition the court to create a special needs trust.

Courtney based his remarks on both his professional experience as a special needs and elder law attorney, as well as his experience as the father of a daughter with cerebral palsy and learning disabilities. Speaking of daughter Melanie, he noted that she needs and is receiving attendant care under a Medicaid waiver program. Because the cost of her care and services is expensive, she must rely on programs such as Medicaid, as do many persons with disabilities.

Right now the law says that she can't create her own trust if she were to receive an inheritance or settlement—so she could forfeit her Medicaid waiver benefits that pay her attendant to her each day for a few hours.

An SNT would allow Melanie to pay for additional health care that's not covered by Medicaid, in addition to basics like clothing, transportation, and furniture.

10/09/2015

People with special needs have won an important victory in the Senate where the Special Needs Trust Fairness Act passed unanimously. However, the fight is not over.

For people with disabilities, special needs trusts are often a vital way to protect assets and ensure that they have the resources needed to meet their expenses. It has become common for parents of children with special needs to make these trusts a part of their estate plans.

But if a person with special needs wants to set up their own special needs trust, they cannot do so without first going to court and going through a long, complex process to get permission.

The Social Security Act provision that allows for these trusts is written such that only a person’s parents or grandparents can create the trusts. So, disabled people without living relatives able to create the trusts for them face a long, uphill battle to create the vital trusts.

Thus, it was a resounding victory for people with special needs when the Senate unanimously passed the Special Needs Trust Fairness Act that would allow people to create the trusts for themselves.

Unfortunately, this legislation appears to be currently stuck in a House subcommittee. It is not expected to make it out of committee in the House without additional support. People who are interested in seeing this legislation passed should contact their representatives and encourage support of the Special Needs Trust Fairness Act.

04/07/2015

If you have a child with special needs, then you know that they often need a lot of money in order to get the basic services they require. This means that you have some extra challenges to overcome in estate planning.

Caring for a child with special needs is not like caring for other children. Other children are expected to eventually be able to support themselves. However, that is not always possible for children with special needs.

Consequently, the parents of a child with special needs must have a plan to care for their child when the parents pass away.

Get Started - The first step is to just get started. You will want to make plans to provide sufficient resources and to ensure that all of your funds will not be used for your own retirement or later-in-life care.

Use New Tools - 529A savings plans may soon be available. They will allow you to save up to $100,000 for your child without jeopardizing your child's eligibility for government benefits.

Trusts - Setting up a special needs trust with the advice of an experienced estate planning attorney is extremely helpful.

Guardians - Plan carefully to appoint your child's guardian. It is often better to have two guardians, one to handle the finances and another to handle other matters.

01/06/2015

Wills can tell a lot about what people value. Looking through old wills can show how values might have changed over the years. The UK has recently aided that effort by making its archived wills available electronically dating back to 1858.

We often hear about the estates of recently deceased celebrities. Anyone can read the newspaper or search Google to find out the details of Michael Jackson's estate. However, the estates of historic famous people are more difficult to find. It often requires going to the library and pouring over history books.

The database includes many famous names, such as Winston Churchill and Charles Dickens. This is an interesting project and well worth a look for anyone who is interested in the lives and deaths of historic figures.

Closer to home, in the United States, something like this would need to be done on the state level.

One important message for modern estate planning is that wills are public.

When filed with a probate court, wills become available for the public to access. While it is not as easy to access wills in the United States as it is in the United Kingdom, it can still be done.

01/05/2015

Sarah Long was found dead in her home last July. While police are still investigating the circumstances of her death, the battle over her estate is heating up.

Sarah Long was reported missing last July and found dead in her home of gunshot wounds. Initially, her death was ruled to be a suicide. However, inconsistent evidence at the scene later caused police to open up a homicide investigation. The police still do not know what happened to Ms. Long.

Long had previously made a will that left everything to her boyfriend. She also had an estranged husband and, under South Carolina law, the husband should be entitled to 15% of her estate regardless of what her will states. (In Florida, the amount would be 30%.)

The husband and the boyfriend have been fighting over the estate in probate court. To make interesting matters more interesting, Long's family has also intervened.

There are allegations that Long made the will giving everything to her boyfriend under duress and that her husband abused her.

The latest development? The boyfriend and the husband have reached an agreement to which Long's family objects. If it turns out that Long was murdered, then the identity of the killer may also play a role in who gets the estate.

Hoskins' will is somewhat refreshing. Recent celebrity estate cases have often been fairly messy with serious estate planning mistakes. Hoskins, however, did what many ordinary people choose to do, he left everything to his spouse.

If a mistake was made here, it is that we know what Hoskins chose to do with his estate. By using a will, the details of his estate were made public. If he had used a trust, it is more likely that his estate and his wife's privacy would have remained free from public scrutiny.

That is something that everyone should keep in mind. Wills are made public. If you do not want everyone knowing the details of your estate, then you need something besides a will.